Intel opened that $3.5 billion facility two years ago and, with sales surging, is apparently now developing a need for additional capacity. The company's been negotiating with the Israeli government for several months, and had originally sought as much as $400 million to finance the $2.7 billion expansion.

The Israeli government is split on Intel's request, according to Haaretz, with the Finance Ministry opposed. (When Intel sought the higher grant, the paper reported in February, it was only committing to 400 new jobs. At $1 million a job, an anonymous Haaretz source in the Finance Ministry called that request "scandalous.")

With the ministries divided, the decision on the grant is apparently left to Prime Minister Benjamin Netanyahu:

Sources close to Netanyahu said the prime minister supports giving Intel
a "reasonable" grant that would enable it to build new plants in
Israel, but in return for a long-term commitment to manufacture its most
advanced products in Israel for an extended period of time, in return
for a state commitment for the grant.

The grant has a great deal of importance in
decision making. It is important for me to clarify that the decision on
the grant will have a deciding influence on whether we establish the
plant here or not. Intel has other alternatives.

(In the same interview, Perlmutter said he wants to be Intel's CEO.)

Intel hasn't opened a new fab in the two years since it finished Kiryat Gat (a new fab in northern China is nearly complete, but won't be making cutting-edge processors.) With chip sales growing again, it's easy to imagine there's demand out there. But as Perlmutter said, Intel has no shortage of suitors.

The company has been clear for many years that it doesn't plan to build another production fab in Oregon. But it does have space for a new development fab on its Ronler Acres campus to replace D1D, which opened in 2003.